If you are in the process of buying a new home, without
question, your first step should be to order a copy of your
credit report. You can do this on your own online, over the
telephone, or through the mail, but it is imperative that
you check your report for accuracy before making an offer on
a new home!

In today’s more credit conscious universe, you may NOT be
able to make an offer on a home until you have been
pre-qualified for a mortgage, or had your credit screened by
the realty company representing the property, depending on a
number of variables that are hard to predict. What is
consistent however, across all buying markets, all
geographical areas, and all lending institutions, is you
need to have reasonably good credit today to buy a home. And
never has that been more important, than right now.
Foreclosures are pushing all time highs throughout the
country. Lenders are literally going out of business right
before our eyes. And just last week, President Bush spoke
publicly about the frightening amount of Americans facing
foreclosure and pending financial ruin.

This leads us back to a very important point: You must know
your credit score before you apply for a loan. You must
repair any blemishes on your credit file before getting a
loan.

Why? Well, the reason so many people are now defaulting on
their mortgages is because they took loans that were * sub
- prime * . And those sub prime loans come with less than
optimal terms as you would expect. Often times variable rate
mortgages, and different financial small print built into
the loan to compensate for the added risk their low credit
scores dictated at the time. So rather than attempted to fix
their credit, many of these Americans, our neighbors,
accepted loans with bad terms to buy that dream home. In
their haste to buy what they thought was the American dream,
they ended up with instead with a nightmare, a financial
bloodbath that is ravaging entire parts of the country at
this very moment.

Would things have been different if these people would have
attempted efficient credit repair strategies BEFORE settling
for sub optimal loans? Well, of course hindsight is 20/20,
and I am no economist, but I think it is fair to say that if
many of these people had taken the time necessary to ensure
their credit was in order PRIOR to applying for financing,
and spent a little bit of extra time if need be getting
things right if they were “wrong”, many of these very
same folks would not be the newspaper statistics that they
have indeed become. And don’t forget – foreclosure
affects you too. If you own a home in a neighborhood with a
foreclosure, some studies show your property value goes down
1% for each defaulted property within 5 blocks of your
house!

Ouch is right..:-)

We all have a vested interest in keeping the fabric of our
credit, and our communities in tact and whole. So if you are
thinking about buying a new home, or even have been
“pre-approved” for a loan by your local lender, make
sure you understand what your credit report says about YOU
before you sign on the dotted line. Your family and your
neighbors might very well thank you later!

Kansieo.com